Ian Cowie was named Consumer Affairs Journalist of the Year in the
London Press Club Awards 2012. He has been head of personal finance at
Telegraph Media Group since 2008, having been personal finance editor
since 1989. He joined the paper in 1986. He is @iancowie on Twitter.

Perhaps surprisingly, shares listed on the Alternative Investment Market (Aim) could provide a little-known way to beat the stealth tax.

Nick Gartland, a director of Investec Wealth & Investment said: “Allowing for inflation, a growing portion of Middle England will face having to pay IHT over the coming years. Worryingly, our research shows that three quarters of adults have never discussed what they stand to inherit financially, if anything, with their parents.

“As many families treat it as a taboo subject, parents often never get round to estate planning before they pass away, which means that few if any measures can be taken to mitigate the impact of IHT. This can reduce assets worth over £325,000, by 40pc.”

While Aim shares can provide a little-known way to beat the stealth tax, it is important to beware many smaller companies are more risky than larger ones. Tony Müdd, a director of St. James’s Place Wealth Management, explained: “If a client wishes to place assets into trust, the current trust tax regime can make this difficult; in particular transfers of assets worth more than the available nil rate band of £325,000. Transfers in excess of this will give rise to a lifetime charge of 25pc, where paid by the creator of the trust.

“One way of avoiding this charge is to convert assets into a portfolio of qualifying Aim Shares. Once these have been held for a minimum of two years they can be placed into trust.

“Taking this approach means an unlimited amount of funds could be placed into a discretionary trust, without giving rise to an immediate IHT charge. If the trust assets continue to qualify for tax relief, the trust will also escape periodic charges on the 10 year anniversary, or on exit when capital is distributed from the trust.”